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Sell-Side trading to PM
 

inv_mgmt's picture
 
Points)
 on 6/9/12 at 1:01am

Hi,
I am currently a student, have a sell-side strategy background and now an internship offer for sell side FI trading. However, my longer term aim is to be a PM in global macro/FI-Fx space.
I am deciding between taking the sell side trading role vs a buy-side research role at a macro/FI/FX fund. If sell-side trading would reasonably lead to the PM role, I'd rather take it because I don't have much research background/skill-set, and would probably not enjoy it as much.
But if something like a hardcore alpha research position at a fund is much more helpful than a sell-side trader to be a PM later, then I'd rather work on the required skills and wait for the right opportunity.
I am not sure if there are any hedge fund managers (who take investment decision and not just execute trades) with sell-side trading background.
All insights/suggestions welcome!
Thanks!!

Tags:
buybuybuy's picture

If you don't like research,

AM
 
Points)
 on 6/9/12 at 8:21am

If you don't like research, then why do you think you will like being a portfolio manager more than being a trader?

NewGuy's picture

Macro trading is the best

HF
 
Points)
 on 6/9/12 at 9:03am

Macro trading is the best path to a macro hedge fund

Determined's picture

PM's do a lot of research and

 
Points)
 on 6/9/12 at 11:34am

PM's do a lot of research and reading. They adjust the strategy to take advantage of different opportunities that they can identify with their experience. My PM isn't even in the office all the time because he doesn't take care of the intraday trading on a regular basis. We have a senior analyst and a quant guy dealing with intraday trading to execute the strategy.

Talent is hitting a target no one can hit.
Genius is hitting a target no one can see.

Bondarb's picture

Yes there are many macro PMs

HF
(Neanderthal, 2,261
 
Points)
 on 6/9/12 at 1:48pm

Yes there are many macro PMs who were former sell-side traders.

buybuybuy's picture

Determined: PM's do a lot of

AM
 
Points)
 on 6/10/12 at 11:43am
Determined:

PM's do a lot of research and reading. They adjust the strategy to take advantage of different opportunities that they can identify with their experience. My PM isn't even in the office all the time because he doesn't take care of the intraday trading on a regular basis. We have a senior analyst and a quant guy dealing with intraday trading to execute the strategy.

Very similar at my shop. The lead PMs don't care about intraday movements. The backup PM and his quant work with the traders on execution while the leads just research and travel.

ypeter123's picture

Bondarb: Yes there are many

 
Points)
 on 12/30/12 at 3:14am
Bondarb:

Yes there are many macro PMs who were former sell-side traders.

@Bondarb -- Since the Volker Rule had banned prop trading at Investment Banks (sell side), the only kind of sell-side traders that continue to exist are the so-called "execution" traders, who do not make decisions on what to trader. Instead, they simply execute trades according to client wishes.

So are you saying that "execution traders" from the sell side have gone on to become macro PMs ?

Bondarb's picture

ypeter123: Bondarb: Yes

HF
(Neanderthal, 2,261
 
Points)
 on 12/30/12 at 8:42am
ypeter123:
Bondarb:

Yes there are many macro PMs who were former sell-side traders.

@Bondarb -- Since the Volker Rule had banned prop trading at Investment Banks (sell side), the only kind of sell-side traders that continue to exist are the so-called "execution" traders, who do not make decisions on what to trader. Instead, they simply execute trades according to client wishes.

So are you saying that "execution traders" from the sell side have gone on to become macro PMs ?

the volker rule has not yet been implemented and its unsure which products it will cover...as of now there are still many sell-side traders who take risk.

ypeter123's picture

Bondarb: ypeter123: Bonda

 
Points)
 on 12/30/12 at 8:53am
Bondarb:
ypeter123:
Bondarb:

Yes there are many macro PMs who were former sell-side traders.

@Bondarb -- Since the Volker Rule had banned prop trading at Investment Banks (sell side), the only kind of sell-side traders that continue to exist are the so-called "execution" traders, who do not make decisions on what to trader. Instead, they simply execute trades according to client wishes.

So are you saying that "execution traders" from the sell side have gone on to become macro PMs ?

the volker rule has not yet been implemented and its unsure which products it will cover...as of now there are still many sell-side traders who take risk.

Okay, but once the Volker Rule comes into play, there would be a lot more of agency/flow traders on the sell side than prop traders. What would you say are some exit options for these agency/flow traders ?

Bondarb's picture

ypeter123: Bondarb: ypete

HF
(Neanderthal, 2,261
 
Points)
 on 12/30/12 at 9:24am
ypeter123:
Bondarb:
ypeter123:
Bondarb:

Yes there are many macro PMs who were former sell-side traders.

@Bondarb -- Since the Volker Rule had banned prop trading at Investment Banks (sell side), the only kind of sell-side traders that continue to exist are the so-called "execution" traders, who do not make decisions on what to trader. Instead, they simply execute trades according to client wishes.

So are you saying that "execution traders" from the sell side have gone on to become macro PMs ?

the volker rule has not yet been implemented and its unsure which products it will cover...as of now there are still many sell-side traders who take risk.

Okay, but once the Volker Rule comes into play, there would be a lot more of agency/flow traders on the sell side than prop traders. What would you say are some exit options for these agency/flow traders ?

the less risk is taken by the sell-side the less opportunity there will be for sell-side traders. however the volker is unlikely to prevent banks from taking risk out of their market-making operations IMO.

ypeter123's picture

Bondarb: ypeter123: Bonda

 
Points)
 on 1/1/13 at 4:50pm
Bondarb:
ypeter123:
Bondarb:

Yes there are many macro PMs who were former sell-side traders.

@Bondarb -- Since the Volker Rule had banned prop trading at Investment Banks (sell side), the only kind of sell-side traders that continue to exist are the so-called "execution" traders, who do not make decisions on what to trader. Instead, they simply execute trades according to client wishes.

So are you saying that "execution traders" from the sell side have gone on to become macro PMs ?

the volker rule has not yet been implemented and its unsure which products it will cover...as of now there are still many sell-side traders who take risk.

So if I want to be an equity derivatives (prop / flow; but NOT agency/execution) trader on the sell-side:-

1. Do you think this kind of position will be eliminated under Volker Rule ?
2. Is it possible for me to move from such a position into a Global Macro PM position after 5-7 yrs ?

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